A. A federal financial institution doing business in the Commonwealth may become a state savings institution, and such a federal financial institution that is a stock institution may become a state bank, as follows:

Terms Used In Virginia Code 6.2-1142

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Commission: means the State Corporation Commission. See Virginia Code 6.2-100
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Deed: The legal instrument used to transfer title in real property from one person to another.
  • Federal financial institution: means a financial institution incorporated or organized in accordance with the laws of the United States. See Virginia Code 6.2-1100
  • Financial institution: means any bank, trust company, savings institution, industrial loan association, consumer finance company, or credit union. See Virginia Code 6.2-100
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Main office: means the office where a savings institution first commences to do business or, if the savings institution has more than one office, the office designated by the institution's board of directors as the institution's main office. See Virginia Code 6.2-1100
  • Mutual savings institution: means a savings institution that is organized and operated exclusively for the benefit of its members and that does not issue shares of capital stock. See Virginia Code 6.2-1100
  • Savings bank: means a savings institution specifically chartered under the laws of the Commonwealth, another state or a territory of the United States, the District of Columbia, or the United States as a savings bank. See Virginia Code 6.2-1100
  • Savings institution: means a savings and loan association, a building and loan association, or savings bank, whether organized as a capital stock corporation or a nonstock corporation, that is authorized by law to accept deposits and to hold itself out to the public as engaged in the savings institution business. See Virginia Code 6.2-1100
  • State: when applied to a part of the United States, includes any of the 50 states, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands, and the United States Virgin Islands. See Virginia Code 1-245
  • State bank: means a bank incorporated under the laws of the Commonwealth and that has its principal business office in the Commonwealth. See Virginia Code 6.2-1100
  • State savings bank: means a savings bank organized and incorporated under the provisions of this chapter. See Virginia Code 6.2-1100
  • State savings institution: means a savings institution incorporated under the laws of the Commonwealth. See Virginia Code 6.2-1100
  • Stock institution: means a savings institution that issues shares of capital stock. See Virginia Code 6.2-1100

1. In either case, the federal financial institution shall take such action as will under federal law and regulations terminate its existence as a federal financial institution on a specified date;

2. In the case of a conversion to a state savings institution, the directors of the federal financial institution shall organize a corporation under this chapter and, if a stock institution, the Virginia Stock Corporation Act (§ 13.1-601 et seq.), or if a mutual savings institution, the Virginia Nonstock Corporation Act (§ 13.1-801 et seq.), and the new corporation shall apply for a certificate of authority to do business under § 6.2-1118; and

3. In the case of a conversion to a state bank, the directors of the federal financial institution shall organize a corporation under Chapter 8 (§ 6.2-800 et seq.) and the Virginia Stock Corporation Act (§ 13.1-601 et seq.), and the new corporation shall apply for a certificate of authority to do business under § 6.2-816. If the applicant meets the standards established by § 6.2-816, the Commission may issue it a certificate of authority to begin a banking business. The order shall designate the main office of the federal financial institution as the main office of the resulting bank, and the resulting bank shall be permitted to operate all branch offices of the former federal financial institution. Within one year of the date of such a conversion, the resulting bank shall conform its assets and operations to the provisions of law regulating the operation of banks. The Commission may grant such resulting bank additional one-year periods, not to exceed a total of four additional years, in which to conform its assets and operations to the provisions of law regulating the operation of banks.

B. The former federal financial institution converting to a state savings institution or a state bank shall transact no business as a state savings institution or as a state bank other than that relating to its organization until its certificate of authority to do business has been granted and its dissolution as a federal financial institution has become effective.

C. As soon as the certificate of authority to do business has been granted and its dissolution as a federal financial institution has become effective, all the property of the federal financial institution shall by operation of law and without any further act or deed be vested in and become the property of the state savings institution or state bank. The state savings institution or state bank shall (i) have, hold and enjoy the same in its own right as fully and to the same extent as the same was possessed, held or enjoyed by the federal financial institution and (ii) become, and continue to be, responsible for all the obligations, duties and agreements of the federal financial institution, including taxes and other liabilities created by law or incurred by it before becoming a state savings institution or state bank to the same extent as though the conversion had not taken place.

D. Upon conversion of a federal financial institution to a state savings bank, the state savings bank shall have the right to continue to operate all branch offices then in existence without having to obtain the approval of the Commission pursuant to § 6.2-1133.

Code 1950, §§ 6-201.45, 6-201.46, 6-201.47; 1960, c. 402; 1966, c. 584, §§ 6.1-175, 6.1-176, 6.1-177; 1972, c. 796, §§ 6.1-195.54, 6.1-195.55, 6.1-195.56; 1975, c. 129; 1985, c. 425, §§ 6.1-194.35, 6.1-194.36, 6.1-194.37; 1991, c. 230, §§ 6.1-194.126, 6.1-194.127, 6.1-194.128; 1995, c. 133; 2010, c. 794.

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